Tuesday, March 31, 2009

Cap-and-Trade: This is Real Money Folks

The WSJ's Environmental Capital blog has a couple posts of their initial thoughts on the House of Representatives' 648 page (PDF) contribution to the general confusion. They are both solid reporting/analysis/opinion (it's a BLOG). First up:

ACES High: The Waxman, Markey Bill and Cap-and-Trade

The 600-page draft House bill on energy and climate aims to tackle a myriad of challenges, including the establishment of a U.S. plan to cap and reduce greenhouse-gas emissions. The cap-and-trade part of the bill promises to be the most contentious....MORE

Forty-five minutes later they came back with:

Cushions and Crutches: How Would the Cap-and-Trade Bill Protect Vulnerable Industries?

Any climate and energy bill coming out of the U.S. Congress has to walk a fine line, protecting jobs and business at home but also extending an olive branch to developing countries to help them curb their emissions. The House draft bill on energy and climate tackles that job with gusto–for business, at least.

For instance, the bill identifies several sectors that are energy-intensive or heavily exposed to global trade, such as steel, cement, paper, chemicals, and the like. Those sectors would get a government handout in the form of rebates to cushion the higher energy bills brought about by climate legislation. This would help keep their products globally competitive.The problem is figuring out just how much those rebates would be. The bill’s relationship with English breaks down a little here when it says the cash rebates will be “equal to the sum of the covered entity’s direct compliance factor and the covered entity’s indirect carbon factor.”>>>MORE

That last bit reminds me of a story [what else is new? -ed] that I told at Environmental Capital:

...During a mis-spent youth I had occasion to read the Internal Revenue Code and got stuck, big time.

I asked a learned Professor of Taxation what a particular section meant. He glanced at the § and said “Oh, that’s incomprehensible” and went back to his paperwork....